Index Numbers: Laspeyres, Paasche, Fisher & Building a Price Index
Build price indices in Excel from an illustrative café basket: simple indices and rebasing, Carli/Dutot/Jevons, Laspeyres, Paasche and Fisher with SUMPRODUCT, quantity and value indices, chain-linking, deflating to real terms and contributions to inflation. 8 graded labs, no affiliation with any statistics office.
The first lesson is free — no account needed.
About this course
An index numbers course that builds price indices from the illustrative cost basket of one fictional coffee bar, Brightwater Café, in a spreadsheet, for economics and statistics students, analysts, procurement staff and anyone who reads inflation figures. You turn prices into an index with 2021 = 100, rebase it and see why index points are not percent, compare the unweighted Carli, Dutot and Jevons indices, price a fixed basket with SUMPRODUCT for a Laspeyres index, add the Paasche and Fisher ideal indices and the substitution bias between them, split value growth into price and quantity indices, chain-link annual baskets into one series, deflate nominal revenue and wages into real terms, and rank each item's contribution to inflation in percentage points with a bar chart. Illustrative data, with no affiliation with any statistics office. The first lab is free.
Lessons
- Simple Index Numbers & Rebasing (Base = 100)Free
- Price Relatives & Unweighted Indices: Carli, Dutot, Jevons Pro
- The Laspeyres Price Index: a Fixed Basket with SUMPRODUCT Pro
- Paasche & the Fisher Ideal Index: Substitution Bias Pro
- Quantity & Value Indices: Price × Quantity = Value Pro
- Chain-Linking an Annual Index Pro
- Deflating: Nominal to Real with a Price Index (Real Revenue & Real Wages) Pro
- Weights & Contributions: Which Item Drove Inflation? Pro